15 Jun 1985
Plan Austral: the austral replaces the peso argentino at 1,000 : 1.
Jul 1989
Peak: 197 % (H&K).
Mar 1990
The H&K episode ends.
1 Jan 1992
The peso replaces the austral at 10,000 : 1.
Cases / Latin America's debt crisis / Argentina
Argentina
1989–1990
The austral was launched in 1985 as the new, strong unit of the Plan Austral and was briefly worth more than a dollar.
197%prices in the worst monthJuly 1989
19.4 daysfor prices to doubleat the peak (Hanke & Krus)
May 1989 – Mar 1990above 50% a monththe hyperinflation itself
None yetbanknotes in the collectionAustral
Currency reform: 1 peso = 10,000 australes · Cause: Debt crisis, a deficit paid by the central bank · Resolution: Convertibility: 10,000 australes = 1 US dollar (1991)
In short
Deficits came back, and by 1989 Argentina was in hyperinflation: 197 % in July 1989, doubling every 19.4 days (H&K). President Alfonsín handed power to Carlos Menem months early. Two more waves followed before the Convertibility Plan of 1991 fixed 10,000 australes to the dollar by law; a year later the new peso replaced the austral.
The curve
Australes per 1 USD, logarithmic scale: each line up is many times the one below.
Hyperinflation from May 1989 to March 1990, peak 197% in July 1989 (Hanke & Krus). The Convertibility law (1991) fixed 10,000 australes to 1 US dollar; the peso replaced the austral on 1 January 1992. Approximate series, kept for its shape; individual points are not sourced one by one. Source: Banco Central de la República Argentina.
What happened
The events in order.
Context: why it happened
- The debt crisis of the 1980s: no external credit, capital flight to the dollar.
- Repeated plans that froze prices without fixing the budget (Plan Austral 1985, Plan Primavera 1988); each freeze ended in a bigger jump.
How it ended
Convertibility was a quasi-currency-board: no peso could be issued without a dollar in reserve, so the central bank could no longer finance the state. The cure became the next crisis when the peg broke in 2001–02.
Consequences & lessons
- A new currency name without a budget fix (austral 1985) buys about two years.
- A hard anchor works as long as the fiscal side honours it — and fails just as hard when it doesn't.
The banknotes
No banknote from this case in the collection yet.
The data
| figure | value | source |
|---|---|---|
| Hyperinflation (≥ 50%/month) | May 1989 – Mar 1990 | H&K |
| Peak month | July 1989 | H&K |
| Peak monthly inflation | 197 % | H&K |
| Doubling time at peak | 19.4 days | H&K |
| Austral at launch | 15 Jun 1985; ₳0.80 per US$ (₳1 = US$1.25) | Wikipedia (Argentine austral) |
| Largest note | ₳500,000 (provisional Jul 1990, definitive Nov 1990) | Wikipedia (Argentine austral) |
| Replaced by | peso convertible, 1 Jan 1992, ₳10,000 = $1 = US$1 | Wikipedia (Argentine austral) |
The series, point by point
| Month | per $ |
|---|---|
| 1989-01 | 18 |
| 1989-03 | 55 |
| 1989-05 | 180 |
| 1989-06 | 350 |
| 1989-07 | 650 |
| 1989-09 | 950 |
| 1989-12 | 1,950 |
| 1990-02 | 5,500 |
| 1990-03 | 5,800 |
| 1990-06 | 5,100 |
| 1990-09 | 5,600 |
| 1990-12 | 5,100 |
| 1991-04 | 10,000 |
Cite this case
“Argentina 1989–1990”, Hyperinflation Archive, hyperinflation.rogzy.org/argentina-1989-1990/ (2026). Figures: Hanke & Krus (2012) and the sources listed below.
“Argentina 1989–1990”, Hyperinflation Archive, hyperinflation.rogzy.org/argentina-1989-1990/ (2026). Figures: Hanke & Krus (2012) and the sources listed below.
Sources
- Hanke & Krus (2012) — episode, peak, doubling time.
- Wikipedia, "Argentine austral" (read 2026-10-05): https://en.wikipedia.org/wiki/Argentine_austral
H&K = Hanke, S. H. & Krus, N. (2012), World Hyperinflations, Cato Institute Working Paper no. 8.